PNC Financial Services Group Receives Neutral Investor Reaction to Strong Quarterly Results

Goldman Sachs analyst Richard Ramsden foresees a neutral investor reaction to PNC Financial Services Group’s strong quarterly results and updated guidance for fiscal year 2024. PNC reported a 2% year-over-year increase in revenue to $5.411 billion, slightly missing the consensus forecast of $5.412 billion. However, the adjusted earnings per share of $3.30 surpassed expectations of $2.98. Looking ahead, PNC expects its net interest income to decline by 4% for FY24, with revenue projected to decrease by 1%-2% compared to the previous year.

The analyst notes that PNC’s guidance for the third quarter of 2024 suggests a slightly lower pre-provision net revenue than what the consensus estimates. Despite the positive earnings report, the updated FY24 guidance indicates a 2% lower pre-provision net revenue compared to market expectations. Ramsden highlights the importance of PNC management’s comments on various factors such as interest income trajectory, expense trends, and credit outlook, especially given the revised rate expectations for the year.

In response to the quarterly performance, PNC shares rose by 4.66% to reach $176.89. Ramsden maintained a Neutral rating on PNC with a price target of $165. Investors interested in exposure to PNC stock can consider options such as IShares U.S. Regional Banks ETF and Invesco Exchange-Traded Fund Trust II Invesco S&P Ultra Dividend Revenue ETF. The analyst also anticipates investor inquiries into PNC’s loan performance, credit trends, and potential impacts of ongoing reserve releases in the near future.